Life Insurers Can Use Social Media Posts To Determine Premiums, As Long As They Don’t Discriminate
February 6, 2019 by Jessica Baron
New York’s Department of Financial Services (NYFS) has released new guidelines that will allow life insurance companies to use data from customers’ social media posts to determine their premiums, and experts say that these rules could potentially extend beyond New York’s borders.
The new guidelines suggest that companies can use data from other “non-traditional” sources as well, though insurers will have to prove the information doesn’t unfairly discriminate against protected groups:
An insurer should not use an external data source, algorithm or predictive model for underwriting or rating purposes unless the insurer can establish that the data source does not use and is not based in any way on race, color, creed, national origin, status as a victim of domestic violence, past lawful travel, or sexual orientation in any manner, or any other protected class.
The NYFS press release states that
…insurers’ use of external data sources has the potential to benefit insurers and consumers alike by simplifying and expediting life insurance sales and underwriting processes. External data sources also have the potential to result in more accurate underwriting and pricing of life insurance.
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